China slowdown good for global steel, says Mittal

Yahoo! News: “A slowdown in the Chinese economy would be good for the global steel industry because it would make over-investment in new capacity less likely, according to Aditya Mittal, president and chief financial officer of Mittal Steel. “When the Chinese government earlier this year tried to cool their economy, [steel] stocks went down, but in my view it should have been the other way around.”

Like most other steel companies, Mittal has been buoyed by a big rise in demand from China. That has been the main reason for a 50-100 per cent increase in steel prices over the past year, swelling the sector’s profits.

He said: “The fact that steel production and consumption in China are slowing reduces the possibility that China will be a sizeable steel exporter, and this will help the rest of the industry”.

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